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Chapter 9 Tonga Toys manufactures and distributes a number of products to retailers. One of these products, Playclay, requires seven kilograms of material A135 in the manufacture of each unit. The company is now planning raw materials needs for the third quarter - July, August, and September. Peak sales of Playclay occur in the third quarter of each year. To keep production and shipments moving smoothly, the company has the following inventory requirements: a. The finished goods inventory on hand at the end of each month must be equal to 5 000 be 29 000 units. units plus 40% of next month's sales. The finished goods inventory on June 30 is budgeted to b. The raw materials inventory on hand at the end of each month must be equal to 20% of the following month's production needs for raw materials. On June 30, the raw materials inventory for material A135 is budgeted to be 88,200 kilograms. c. The company maintains no work in process inventories A sales budget for Playclay for the last six months of the year follows: Budgeted Sales in Units July 60,000 August 80,000 September 40,000 October 45,000 November 55,000 December 30,000 Required: 1. Prepare a production budget for Playclay for the months July, August, September, and October. - 12 Marks 2. Prepare a budget showing the quantity of material A135 to be purchased for July, August, and September and for the quarter in total. - 12 Marks